UNFCCC/CCNUCC
CDM – Executive Board
EB 68
Report
Annex 26
Page 1
Annex 26
GUIDELINES FOR DEMONSTRATING ADDITIONALITY OF MICROSCALE
PROJECT ACTIVITIES
(Version 04.0)
I. Background
1.
The following paragraphs are quoted from decision 2/CMP.5 and 3/CMP.6. Further
guidance relating to the clean development mechanism:
“24. Requests the Executive Board, starting at its next meeting, to further work
and report to the Conference of the Parties serving as the meeting of the Parties
to the Kyoto Protocol on the enhancement of objectivity and transparency in the
approaches for demonstration and assessment of additionality and selection of the
baseline scenario by means of the following activities:
“…
“(c) Establishment of simplified modalities for demonstrating additionality for
project activities up to 5 megawatts that employ renewable energy as their
primary technology and for energy efficiency project activities that aim to
achieve energy savings at a scale of no more than 20 gigawatt hours per year;”
“38. welcomes the work of the CDM Executive Board on the establishment of
simplified modalities for demonstrating additionality for project activities up to
five megawatts that employ renewable energy as their primary technology and
for energy efficiency project activities that aim to achieve energy savings at a
scale of no more than 20 gigawatt hours per year.
“39. requests the Board to continue to simplifying these modalities based on
experience gained and to expand, as appropriate, their applicability to Type III
projects that reduce emissions by less than 20,000 tonnes of carbon dioxide
equivalent per annum and to report back to the Conference of the Parties serving
as the meeting of the Parties to the Kyoto Protocol at its seventh session on the
experience gained including the appropriateness of the threshold.”
UNFCCC/CCNUCC
CDM – Executive Board
EB 68
Report
Annex 26
Page 2
II. Guidelines1
2.
Project activities up to five megawatts1 that employ renewable energy technology2 are
additional if any one of the conditions below is satisfied:3
(a)
The geographic location of the project activity is in one of the least developed
countries or the small island developing States (LDCs/SIDS) or in a special
underdeveloped zone (SUZ)of the host country.
(i)
(ii)
(b)
1
2
3
4
5
6
7
8
SUZ is a region in the host country (zone, municipality or any other
designated official administrative unit) identified by the Government in
official notifications for development assistance including for planning,
management, and investment satisfying any one of the following
conditions using most recent available data:

The proportion of population with income less than USD 2 per day
(PPP)4 in the region is greater than 50%;

The GNI per capita in the country is less than USD 30005 and the
population of the region is among the poorest 20% in the poverty
ranking of the host country as per the applicable national policies and
procedures;6
In cases where, based on the recommendation of the designated national
authority of the host country,7 the SUZ in the host country has been
approved by Executive Board (hereinafter referred to as the Board) of the
clean development mechanism (CDM), the list of such SUZ shall be
maintained on the UNFCCC website (e.g. at
<http://cdm.unfccc.int/DNA/submissions/index.html>). In the case of
these SUZ listed on the CDM website there is no need for the project
proponents to provide proofs as indicated in paragraph 2 (a) above.8
The project activity is an off-grid activity supplying energy to
households/communities (less than 12 hours grid availability per 24 hrs is also
considered “off-grid” for this assessment);
A positive list of technologies that are automatically defined as additional are included in “Guidelines on
the demonstration of additionality of small-scale project activities” for which it is not required to satisfy
the conditions indicated here (see EB 68, annex 27).
All technologies/measures included in approved Type I Small Scale CDM methodologies are eligible to be
considered. Furthermore at its fifty-seventh meeting the Board clarified that all CDM project activities that
meet the criteria specified in these guidelines are eligible to apply the guidelines irrespective of the scale of
the approved CDM methodology applied to the project activity.
Otherwise other means for demonstrating additionality shall be used (e.g. the tool “Tool for demonstration
of additionality”, or “Guidelines on the demonstration of additionality of small-scale project activities”).
Purchasing power parity.
PPP or the World Bank atlas method or another comparable method.
Information on per capita income or other economic indicators used for the ranking purposes shall be
provided in USD.
DNA recommendations will be based on conditions indicated in paragraph 2(a)(i).
Forms and procedures for DNA recommendations shall be developed and made available at a later date.
UNFCCC/CCNUCC
CDM – Executive Board
EB 68
Report
Annex 26
Page 3
(c)
(d)
The project activity is designed for distributed energy generation (not connected to
a national or regional grid)9 with both conditions (i) and (ii) satisfied;
(i)
Each of the independent subsystems/measures in the project activity is
smaller than or equal to 1500kW electrical installed capacity;
(ii)
End users of the subsystems or measures are
households/communities/small and medium enterprises (SMEs).10
The project activity employs specific renewable energy technologies/measures
recommended by the host country designated national authority (DNA) and
approved by the Board to be additional in the host country. The following
conditions shall apply for DNA recommendations:
(i)
“Specific renewable energy technologies/measures” refers to grid
connected renewable energy technologies11 of installed capacity equal to
or smaller than 5 MW;
(ii)
The ratio of installed capacity of the specific grid connected renewable
energy technology in the total installed grid connected power generation
capacity in the host country shall be equal to or less than 3 per cent;12
(iii)
Most recent available data on the percentage of contributions of specific
renewable energy technologies shall be provided to demonstrate
compliance with the 3 per cent threshold. In no case shall data older than
three years from the date of submission be used;
(iv)
Technologies/measures recommended by DNAs and approved by the
Board to be additional in the host country remain valid for three years
from the date of approval. However, additionality of eligible project
activities applying the guidelines remains valid for the entire crediting
period;
(v)
DNA submissions shall include the specific grid connected renewable
electricity generation technologies that are being recommended and
provide the required data as indicated above (e.g. wind power, biomass
power, geothermal power, hydropower).
3.
Energy efficiency project activities13 that aim to achieve energy savings at a scale of no
more than 20 gigawatt hours per year are additional if any one of the conditions below is satisfied:
9
10
11
12
This means that projects applying AMS.I-D are not eligible. However project activities generating thermal
energy such as solar water heaters displacing grid-connected electric heaters can apply paragraph 2(c).
“communities” of consumers may for example include households, commercial facilities such as shops,
public services/buildings and small, medium and micro enterprises (SMMEs); Applications may include
lighting (interior, public street lighting), electrical appliances such as refrigerators, agricultural water
pumps”.
Renewable technologies that do not generate electricity, such as heating and cooling technologies, are not
eligible.
For example, if the ratio of total installed capacity of all grid-connected hydropower plants with the
capacity equal to or smaller than 5 MW and the national grid-connected installed electricity generation
capacity is less than 3 per cent in a host country then microscale hydropower is eligible for DNA
recommendation in that host country.
UNFCCC/CCNUCC
CDM – Executive Board
EB 68
Report
Annex 26
Page 4
(a)
The geographic location of the project activity is in an LDC/SIDS or special
underdeveloped zone of the host country identified by the government in
accordance with the paragraph 2 (a) (i) above;
(b)
The project activity is an energy efficiency activity with both conditions (i) and (ii)
below satisfied:
(i)
Each of the independent subsystems/measures in the project activity
achieves an estimated annual energy savings equal to or smaller than
600 megawatt hours;
(ii)
End users of the subsystems or measures are
households/communities/SMEs.
4.
Other project activities not included in paragraphs 2 or 3 above, i.e. Type III project
activities14 that aim to achieve emission reductions at a scale of no more than 20 ktCO2e per year,
are additional if any one of the following conditions is satisfied:
(a)
The geographic location of the project activity is an LDC/SIDS or special
underdeveloped zone of the host country as identified by the government in
accordance with the paragraph 2 (a) (i) above;
(b)
The project activity is an emission reduction activity with both conditions (i) and
(ii) below satisfied:
(i)
Each of the independent subsystems/measures in the project activity
achieves an estimated annual emission reduction equal to or less than
600 tCO2e per year; and
(ii)
End users of the subsystems or measures are
households/communities/SMEs.
5.
Project activities that meet the requirements specified in paragraph 2 or paragraph 3 or
paragraph 4 above are termed “Microscale CDM project activities”.
6.
“Project activity” in paragraphs 2–4 means a small-scale or large-scale clean development
mechanism (CDM) project activity or a project activity under a programme of activities (CPA of a
PoA).
7.
In the case of bundled projects, “Project activity” in paragraphs 2-4 refers to individual
projects within the bundle and these guidelines are applied in conjunction with the “Guidelines on
13
14
All technologies/measures included in approved Type II small-scale CDM methodologies are eligible to be
considered. Further, the Board at its fifty-seventh meeting clarified that all CDM project activities that
meet the criteria specified in the guidelines are eligible to apply the guidelines irrespective of the scale of
the approved CDM methodology applied to the project.
All technologies/measures included in approved Type III small-scale CDM methodologies are currently
eligible to be considered, except for AMS-III.V “Decrease of coke consumption in blast furnace by
installing dust/sludge recycling system in steel works”, AMS-III.P “Recovery and utilization of waste gas
in refinery facilities”, AMS-III.Q “Waste Energy Recovery (gas/heat/pressure) Projects” and AMS-III.W
“Methane capture and destruction in non-hydrocarbon mining activities”. In the latter cases further
analysis is required.
UNFCCC/CCNUCC
CDM – Executive Board
EB 68
Report
Annex 26
Page 5
assessment of debundling for SSC project activities” (EB 54, annex 13) excluding paragraph 3 of
section A15 of the latter guidelines.
8.
The eligibility of project activities as microscale CDM project activities will be determined
in accordance with the principles laid out in paragraph 3 and paragraph 4 of the “General
Guidelines to SSC CDM methodologies” (version 16 or its update), i.e.:
(a)
Project activities remain under the thresholds defined above during each year of
the crediting period and in cases where ex ante projected emissions reductions
show an increase during the crediting period; project activities that go beyond the
microscale limits in any year of the crediting period are not eligible;
(b)
Renewable energy projects that produce electrical, thermal and mechanical energy,
and cogeneration projects are covered. Definitions provided for output capacity
and guidelines provided for conversion from electrical to thermal units16 in the
most recent version of “General Guidelines to SSC CDM methodologies” shall be
used. Where applicable, additional guidelines provided in relevant methodologies
shall be followed, e.g. eligibility of cogeneration projects as currently defined in
AMS-I C;
(c)
A project activity with more than one component, where each component meets
the microscale threshold, is eligible. The sum of the size of components of a
project activity belonging to the same type (capacity for Type I, energy savings for
Type II and emission reductions for Type III) shall not exceed the limits for
microscale project activities (e.g. the limit for the methane recovery component is
20 ktCO2e/yr and the limit for the electricity production component is 5 MW
output capacity).
9.
Microscale CDM project activities shall apply the “Guidelines on the demonstration and
assessment of prior consideration of the CDM” (EB 57, paragraph 12).
10.
Microscale CDM project activities shall demonstrate that they are not a debundled
component of a small-scale (SSC) CDM project activity by applying the criteria in the “Guidelines
on assessment of debundling for SSC project activities”, for example by suitably considering
microscale thresholds in the place of SSC thresholds (EB 62, para 48).
15
16
This means that the following paragraph of the debundling guidelines is not applicable: “If a proposed
small-scale project activity is deemed to be a debundled component in accordance with paragraph 2 above,
but total size of such an activity combined with the previous registered small-scale CDM project activity
does not exceed the limits for small-scale CDM project activities as set in paragraph 6 (c) of the decision
17/CP.7,3 the project activity can qualify to use simplified modalities and procedures for small-scale CDM
project activities”.
That is multiply by 3 to derive thermal units from electrical units irrespective of the type of project or
methodology applied.
UNFCCC/CCNUCC
CDM – Executive Board
EB 68
Report
Annex 26
Page 6
Is RE project activity (see paragraph 6)
size <=5 MW of installed capacity ?
No
If Yes, go to (a) or (b) or (c) or (d)
(a) Is the geographic
location of the project in
an LDC/SIDS or a
special underdeveloped
zone of the host country
identified by the
government in
accordance with the
paragraph 2 (a) (i)?
Yes
(b) Is the project activity
No
A
an off-grid (<12 hrs grid
availability per 24 hr day
is also considered offgrid for this assessment)
project supplying to
households/
communities?
Yes
No
A
(c ) The project activity
involves distributed
renewable energy
generation and each of the
independent
subsystems/measures in
the project <=1500 kW
and end users of the
subsystems or measures
are households or
communities or SMEs.
No
(d) Specific gridconnected renewable
energy technologies
recommended by the host
country DNA and
approved by the Board
A
A
Yes
Yes
A
Project activity is additional
Figure 1: Microscale additionality test for RE project activities
No
Note:
means use other means of additionality
demonstration (e.g. Tool for demonstration of
additionality, “Guidelines on the demonstration of
additionality of small-scale project activities”
UNFCCC/CCNUCC
CDM – Executive Board
EB 68
Report
Annex 26
Page 7
No
Does the project activity (see paragraph 6) achieve <=20
GWh energy savings per year?
If Yes, go to (a) or (b)
(a) Is the geographic location of
the project activity in an
LDC/SIDS or a special
underdeveloped zone of the host
country identified by the
government in accordance with
the paragraph 2 (a) (i)?
(b) Each of the independent
subsystems/measures in the project
activity annually saves <=600
MWh and end users of the
subsystems or measures are
households/ communities/SME
No
No
A
Yes
A
Yes
A
Project activity is additional
Figure 2: Microscale additionality test for EE project activities
Note:
means use other means of additionality
demonstration (e.g. the “Tool for demonstration of
additionality”, “Guidelines on the demonstration of
additionality of small-scale project activities”)
UNFCCC/CCNUCC
CDM – Executive Board
EB 68
Report
Annex 26
Page 8
No
Is the emission reduction of the project activity (see paragraph 6)
<=20 ktCO2 per year?
If Yes, go to (a) or (b)
(a) Is the geographic location of project
activity in an LDC/SIDS or a special
underdeveloped zone of the host
country identified by the government
No
in accordance with the paragraph 2
(a) (i)?
(b) Each of the independent
subsystems/measures in the project
annually saves <=600 tons and end
users of the subsystems or measures
are households/ communities/SME
No
A
A
Yes
Yes
A
Project activity is additional
Figure 3: Microscale additionality test for project activities <= 20 ktCO2/y
emission reductions
Note:
means Use other means of additionality
demonstration (e.g. “Tool for demonstration of
additionality”,“Guidelines on the demonstration of
additionality of small-scale project activities”)
UNFCCC/CCNUCC
CDM – Executive Board
EB 68
Report
Annex 26
Page 9
----History of the document
Version
04.0
Date
20 July 2012
03
EB 63, Annex 23
29 September 2011
02
EB 60, Annex 25
15 April 2011
01
EB 54, Annex 15
28 May 2010
Decision Class: Regulatory
Document Type: Guideline
Business Function: Methodology
Nature of revision(s)
EB 68, Annex 26
- Includes options to define the special underdeveloped zones in a host
country;
- Clarifies the eligibility for project activities generating thermal energy
such as solar water heaters displacing grid-connected electric
heaters;
- Provides an example for the definition of “communities”.
-Header removed that was inadvertently added to version 02;
-Provision of additional guidance on paragraph 2 (d), specifically on the
definition of the applicable threshold.
-Title of document has been changed.
-Inclusion of Type III projects, CPAs, project activities with more than
one component.
Initial adoption.